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c Experian plc Strategic report Experian Annual Report 2021 Experian Annual Report Transforming lives with data Experian Annual Report 2021 Year ended 31 March 2021 Transforming with lives data Contents Our purpose Strategic report To create a better tomorrow for consumers, for 02 Experian at a glance 04 Chairman’s statement businesses, for our people and for our communities. 06 Chief Executive’s review 10 Our purpose in action – COVID-19 response 14 Our investment case What we do 16 Key performance indicators 18 Market trends We create opportunities by turning data into 20 Our business model information, and by deploying advanced technologies 26 Our strategic focus areas 38 Our sustainable business strategy: and analytics. Environmental, Social and Governance 57 Non-financial information and s172(1) statement Why this matters 58 North America regional review 59 Latin America regional review As the world’s leading information services company 60 UK and Ireland regional review we play a pivotal role in the societies in which we work. 61 EMEA/Asia Pacific regional review 62 Financial review We believe it is our responsibility to use our capabilities 72 Risk management 81 Viability and going concern and data as a force for good. Governance 84 Chairman’s introduction 86 Board of directors 88 Corporate governance report 99 Nomination and Corporate Governance Committee report 104 Audit Committee report 111 Report on directors’ remuneration 135 Directors’ report Financial highlights Financial statements Growth % at Growth % at Growth % at Growth % at 139 Financial statements contents Statutory actual rates constant rates Benchmark actual rates constant rates 140 Independent auditor’s report Revenue Revenue – ongoing Group financial statements activities 147 Group income statement +4% +6% +4% +7% 148 Group statement of comprehensive income 149 Group balance sheet US$5,372m US$5,357m 150 Group statement of changes in equity (2020: US$5,179m) (2020: US$5,161m) 151 Group cash flow statement Operating profit Benchmark EBIT¹ 152 Notes to the Group financial statements Company financial statements US$1,183m 0% +4% US$1,385m 0% +3% 206 Company financial statements (2020: US$1,185m) (2020: US$1,386m) 208 Notes to the Company financial statements Profit before tax Benchmark profit 220 Shareholder and corporate information before tax +14% +6% +1% +5% 222 Glossary US$1,077m US$1,265m To download this Annual Report (2020: US$942m) (2020: US$1,255m) and our other corporate literature visit www.experianplc.com Basic EPS Benchmark EPS Roundings USc88.2 +18% +5% USc103.1 0% +4% Certain financial data has been rounded in this report. (2020: USc74.8) (2020: USc103.0) As a result, the totals of data presented may vary slightly from the actual arithmetic totals of the data. 1 From ongoing activities. Exchange rates The 2020 financial highlights have been re-presented following the reclassification of our Consumer Services business in Latin America Principal exchange rates used are given in note 10 to the to the Consumer Services business segment. See note 9 to the Group financial statements for further detail. Group financial statements. The average pound sterling to US dollar rate is 1.31 (2020 1.27). See note 6 to the Group financial statements on page 160 for definitions of non-GAAP measures. Experian plc Annual Report 2021 01 An unprecedented year reportStrategic The past year was not one that we, or anyone, could have predicted. For many it has been a time of great hardship and loss. The COVID-19 pandemic is sadly not over yet and we are all working through its impact, the long-term effects of which are unknown. At Experian, we have played an essential role in helping people, businesses, governments, and society manage through the crisis. We have helped our employees adapt to remote working and we have reoriented how we engaged with tens of thousands of clients. A good performance, demonstrating the resilience of our business Experian delivered growth in FY21. Organic revenue growth was 4% and total revenue growth from ongoing activities was 7% at constant currency. North America and Brazil performed strongly, offsetting declines in UK and Ireland, and EMEA/Asia Pacific. Our ability to grow, even in a crisis, reflects the strength and diversity of our portfolio. It also reflects our commitment to innovation and to the millions of relationships we have established with consumers. Looking ahead to FY22 we are poised for strong growth. Our addressable markets are large and expanding, and we are well placed to take advantage of a number of compelling opportunities. Brian Cassin Chief Executive Officer We play a vital role for People Businesses Communities, governments Empowering them to better Helping them to make more and charities understand their financial position, to informed and better decisions. Using data to help the most take control of their finances and vulnerable in society and to support manage their financial health. economic growth. 02 Experian plc Strategic report Experian at a glance Global technology and innovation We are a global technology company playing a key role in making it easier for consumers and businesses to interact. We help them manage their financial health, make informed decisions and seize opportunities. We embrace innovation and harness technology to expand access to credit, support responsible lending, modernise processes and better protect against fraud and identity theft. Our talented and diverse workforce serves customers worldwide from 44 countries. We manage and organise ourselves across four geographic reporting regions and two business segments. Our business activities Business-to-Business Consumer Services Data Decisioning Revenue - ongoing activities1 Revenue - ongoing activities1 Revenue - ongoing activities1 US$2,866m US$1,184m US$1,307m +2% -4% +17% We help businesses to identify and understand We are experts at creating and developing We help consumers take control of their credit, their customers and to lend responsibly and innovative analytical and decisioning tools. making it easier for them to manage their appropriately, providing them with the We help businesses to manage their financial position, receive financial education, information to help them manage the risks customers, minimise the risk of fraud, access credit offers, and protect themselves associated with lending. We also help them comply with legal requirements and from identity fraud. build a better understanding of consumers’ automate decisions and processes. preferences. 1 % growths shown are organic revenue growth at constant exchange rates. Revenue from ongoing activities by region and business activity (US$m) Business-to- Consumer Total Data Decisioning Business Services US$m % split A North America 1,761 694 2,455 1,075 3,530 65 B Latin America 457 92 549 76 625 12 C UK and Ireland 361 220 581 156 737 14 D EMEA/Asia Pacific 287 178 465 n/a 465 9 Total 2,866 1,184 4,050 1,307 5,357 17,800* employees globally bn DataLab 1.3 London Consumer credit 166m history records Business credit history records DataLab San Diego DataLab 44 Singapore Countries 110 m DataLab Free consumer São Paulo membership base North America Latin America UK and Ireland EMEA/Asia Pacific See page 58 See page 59 See page 60 See page 61 * Figure does not include recent acquisitions in Spain and Brazil. Experian plc Annual Report 2021 03 Strategic reportStrategic Our strategic focus areas Our sustainable business strategy See page 26 See page 38 1 OUR PURPOSE Make credit and Creating a better lending simpler, faster and safer for consumers tomorrow and businesses 5 2 Enable businesses Empower Improving financial health for all to find, understand consumers to improve and connect their financial lives THROUGH OUR with audiences Core Social Community Our products Innovation investment customers ENABLED BY 4 3 Treating data with respect Help organisations Help businesses Security Accuracy Privacy Transparency in specialised vertical verify identity and markets harness data and combat fraud analytics to make smarter decisions SUPPORTED BY Inspiring Working Protecting and supporting with the our people integrity environment Our investment case, a unique proposition See page 14 We are a leader in global Strong foundations support our We place a strong emphasis We remain financially well information services with strong growth potential on environmental, social and positioned positions in growing markets governance (ESG) criteria 04 Experian plc Strategic report Chairman’s statement Supporting our customers, clients and communities in challenging times Responding to the crisis in a purpose- led way – using data for good The pandemic has demonstrated the power of data as a force for good in difficult times. Data-led decision-making has been critical in helping us to take on the biggest challenge in a generation. In the USA, we developed the COVID-19 Outlook & Response Evaluator (CORE) tool to predict future hot zones for the virus – a free application that allows health and government leaders to forecast how a specific area may be affected. Mike Rogers In the UK, we launched Experian Safeguard, a Chairman dashboard based on anonymised data insights, to help organisations, including food banks and local authorities, to plan and allocate their resources based on those who need it most. The pandemic has demonstrated the power of data as a force for good In Brazil, the COVID Radar Panel provided information about the pandemic to partners, in difficult times. Data-led decision- offering them a detailed view on COVID-19 making has been critical in helping movement by city and even by neighbourhood, us to take on the biggest challenge to allow the adoption of quick and assertive in a generation. Experian moved measures in the most affected areas. quickly to make our data insights available to governments, health Supporting global financial health services, communities, businesses Alongside these data-driven initiatives, our United for Financial Health programme has used and charities, so they could better financial education and partnerships to help the respond to their challenges.